Business Plan of Insurance Sector

7/29/2019 Business Plan of Insurance Sector

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http://winsure.yolasite.com 1

Indian Insurance SectorHistory

Insurance in India has its history dating back until 1818,when Oriental Life Insurance Company was started by

Anita Bhavsar in Kolkata to cater to the needs ofEuropean community.

The pre-independence era in India saw discriminationbetween the lives of foreigners (English) and Indianswith higher premiums being charged for the latter.

In 1870, Bombay Mutual Life Assurance Society becamethe first Indian insurer
http://en.wikipedia.org/wiki/Kolkatahttp://en.wikipedia.org/wiki/Kolkata


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Important milestones in the Indian life insurance business

1912: The Indian Life Assurance Companies Act came into force forregulating the life insurance business.

1928: The Indian Insurance Companies Act was enacted for enablingthe government to collect statistical information on both life and non-lifeinsurance businesses.

1938: The earlier legislation consolidated the Insurance Act with the aimof safeguarding the interests of the insuring public.

1956: 245 Indian and foreign insurers and provident societies weretaken over by the central government and they got nationalized. LIC wasformed by an Act of Parliament, viz. LIC Act, 1956. It started off with a

capital of Rs. 5 crore and that too from the Government of India.

The history of general insurance business in India can be traced back toTriton Insurance Company Ltd. (the first general insurance company)which was formed in the year 1850 in Kolkata by the British.


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Important milestones in the Indian general insurance business

1907: The Indian Mercantile Insurance Ltd. was set up which was the firstcompany of its type to transact all general insurance business.

1957: General Insurance Council, an arm of the Insurance Association ofIndia, framed a code of conduct for guaranteeing fair conduct and soundbusiness patterns.

1968: The Insurance Act improved for regulating investments and setminimal solvency levels and the Tariff Advisory Committee was set up.

1972: The General Insurance Business (Nationalization) Act, 1972nationalized the general insurance business in India. It was with effect from1st January 1973.

107 insurers integrated and grouped into four companies viz. the NationalInsurance Company Ltd., the New India Assurance Company Ltd., theOriental Insurance Company Ltd. and the United India Insurance CompanyLtd. GIC was incorporated as a company.


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Insurance Companies in India

Life Insurance Companies

Aviva Life Insurance Bajaj Allianz Life Insurance Birla Sun-Life Insurance

HDFC Standard Life Insurance ING Vysya Life Insurance Life Insurance Corporation Max New York Life Insurance MetLife Insurance Om Kotak Mahindra Life Insurance

Reliance Life Insurance Sahara India Life Insurance SBI Life Insurance TATA AIG Life Insurance
http://business.mapsofindia.com/india-insurance/life.htmlhttp://business.mapsofindia.com/india-insurance/aviva-life.htmlhttp://business.mapsofindia.com/insurance/bajaj-allianz-insurance-india.htmlhttp://business.mapsofindia.com/insurance/bajaj-allianz-insurance-india.htmlhttp://business.mapsofindia.com/insurance/birla-sun-life-financial-services.htmlhttp://business.mapsofindia.com/insurance/birla-sun-life-financial-services.htmlhttp://business.mapsofindia.com/insurance/standard-life-insurance-india.htmlhttp://business.mapsofindia.com/insurance/standard-life-insurance-india.htmlhttp://business.mapsofindia.com/insurance/ing-vysya-life-insurance-india.htmlhttp://business.mapsofindia.com/insurance/ing-vysya-life-insurance-india.htmlhttp://business.mapsofindia.com/india-insurance/lic.htmlhttp://business.mapsofindia.com/india-insurance/lic.htmlhttp://business.mapsofindia.com/insurance/max-life-insurance-india.htmlhttp://business.mapsofindia.com/insurance/max-life-insurance-india.htmlhttp://business.mapsofindia.com/insurance/metlife-insurance.htmlhttp://business.mapsofindia.com/insurance/metlife-insurance.htmlhttp://business.mapsofindia.com/insurance/om-kotak-mahindra-insurance-india.htmlhttp://business.mapsofindia.com/insurance/om-kotak-mahindra-insurance-india.htmlhttp://business.mapsofindia.com/insurance/reliance-life-insurance.htmlhttp://business.mapsofindia.com/insurance/reliance-life-insurance.htmlhttp://business.mapsofindia.com/insurance/sahara-india-life-insurance.htmlhttp://business.mapsofindia.com/insurance/sahara-india-life-insurance.htmlhttp://business.mapsofindia.com/insurance/sbi-life-insurance.htmlhttp://business.mapsofindia.com/insurance/sbi-life-insurance.htmlhttp://business.mapsofindia.com/insurance/tata-aig-life-insurance-india.htmlhttp://business.mapsofindia.com/insurance/tata-aig-life-insurance-india.htmlhttp://business.mapsofindia.com/insurance/tata-aig-life-insurance-india.htmlhttp://business.mapsofindia.com/insurance/tata-aig-life-insurance-india.htmlhttp://business.mapsofindia.com/insurance/sbi-life-insurance.htmlhttp://business.mapsofindia.com/insurance/sbi-life-insurance.htmlhttp://business.mapsofindia.com/insurance/sahara-india-life-insurance.htmlhttp://business.mapsofindia.com/insurance/sahara-india-life-insurance.htmlhttp://business.mapsofindia.com/insurance/reliance-life-insurance.htmlhttp://business.mapsofindia.com/insurance/reliance-life-insurance.htmlhttp://business.mapsofindia.com/insurance/om-kotak-mahindra-insurance-india.htmlhttp://business.mapsofindia.com/insurance/om-kotak-mahindra-insurance-india.htmlhttp://business.mapsofindia.com/insurance/metlife-insurance.htmlhttp://business.mapsofindia.com/insurance/metlife-insurance.htmlhttp://business.mapsofindia.com/insurance/max-life-insurance-india.htmlhttp://business.mapsofindia.com/insurance/max-life-insurance-india.htmlhttp://business.mapsofindia.com/india-insurance/lic.htmlhttp://business.mapsofindia.com/india-insurance/lic.htmlhttp://business.mapsofindia.com/insurance/ing-vysya-life-insurance-india.htmlhttp://business.mapsofindia.com/insurance/ing-vysya-life-insurance-india.htmlhttp://business.mapsofindia.com/insurance/standard-life-insurance-india.htmlhttp://business.mapsofindia.com/insurance/standard-life-insurance-india.htmlhttp://business.mapsofindia.com/insurance/birla-sun-life-financial-services.htmlhttp://business.mapsofindia.com/insurance/birla-sun-life-financial-services.htmlhttp://business.mapsofindia.com/insurance/birla-sun-life-financial-services.htmlhttp://business.mapsofindia.com/insurance/birla-sun-life-financial-services.htmlhttp://business.mapsofindia.com/insurance/bajaj-allianz-insurance-india.htmlhttp://business.mapsofindia.com/insurance/bajaj-allianz-insurance-india.htmlhttp://business.mapsofindia.com/india-insurance/aviva-life.htmlhttp://business.mapsofindia.com/india-insurance/aviva-life.htmlhttp://business.mapsofindia.com/india-insurance/life.html


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Insurance Companies in India

General Insurance Companies

Agriculture Insurance Amsure Insurance ANZ Insurance Bajaj Allianz General Insurance Cholamandalam General Insurance Employee State Insurance Export Credit Guarantee Corporation ICICI Lombard General Insurance IFFCO-Tokio General Insurance

National Insurance Oriental Insurance Peerless Smart Financial Royal Sundaram Alliance TATA AIG General Insurance
http://business.mapsofindia.com/insurance/general-insurance-india.htmlhttp://business.mapsofindia.com/insurance/agriculture-insurance-company-of-india-ltd.htmlhttp://business.mapsofindia.com/insurance/amsure-insurance.htmlhttp://business.mapsofindia.com/insurance/amsure-insurance.htmlhttp://business.mapsofindia.com/insurance/anz-insurance.htmlhttp://business.mapsofindia.com/insurance/anz-insurance.htmlhttp://business.mapsofindia.com/insurance/bajaj-allianz-insurance-india.htmlhttp://business.mapsofindia.com/insurance/bajaj-allianz-insurance-india.htmlhttp://business.mapsofindia.com/insurance/cholamandalam-ms-general-insurance.htmlhttp://business.mapsofindia.com/insurance/cholamandalam-ms-general-insurance.htmlhttp://business.mapsofindia.com/insurance/employee-state-insurance-corporation.htmlhttp://business.mapsofindia.com/insurance/employee-state-insurance-corporation.htmlhttp://business.mapsofindia.com/insurance/export-credit-guarantee-corporation-of-india-ltd.htmlhttp://business.mapsofindia.com/insurance/export-credit-guarantee-corporation-of-india-ltd.htmlhttp://business.mapsofindia.com/insurance/icici-lombard.htmlhttp://business.mapsofindia.com/insurance/icici-lombard.htmlhttp://business.mapsofindia.com/insurance/iffco-tokio.htmlhttp://business.mapsofindia.com/insurance/iffco-tokio.htmlhttp://business.mapsofindia.com/india-insurance/national-insurance.htmlhttp://business.mapsofindia.com/india-insurance/national-insurance.htmlhttp://business.mapsofindia.com/india-insurance/oriental.htmlhttp://business.mapsofindia.com/india-insurance/oriental.htmlhttp://business.mapsofindia.com/insurance/peerless-smart-financial-solutions.htmlhttp://business.mapsofindia.com/insurance/peerless-smart-financial-solutions.htmlhttp://business.mapsofindia.com/insurance/royal-sundram-alliance-insurance-india.htmlhttp://business.mapsofindia.com/insurance/royal-sundram-alliance-insurance-india.htmlhttp://business.mapsofindia.com/insurance/tata-aig-life-insurance-india.htmlhttp://business.mapsofindia.com/insurance/tata-aig-life-insurance-india.htmlhttp://business.mapsofindia.com/insurance/tata-aig-life-insurance-india.htmlhttp://business.mapsofindia.com/insurance/tata-aig-life-insurance-india.htmlhttp://business.mapsofindia.com/insurance/royal-sundram-alliance-insurance-india.htmlhttp://business.mapsofindia.com/insurance/royal-sundram-alliance-insurance-india.htmlhttp://business.mapsofindia.com/insurance/peerless-smart-financial-solutions.htmlhttp://business.mapsofindia.com/insurance/peerless-smart-financial-solutions.htmlhttp://business.mapsofindia.com/india-insurance/oriental.htmlhttp://business.mapsofindia.com/india-insurance/oriental.htmlhttp://business.mapsofindia.com/india-insurance/national-insurance.htmlhttp://business.mapsofindia.com/india-insurance/national-insurance.htmlhttp://business.mapsofindia.com/insurance/iffco-tokio.htmlhttp://business.mapsofindia.com/insurance/iffco-tokio.htmlhttp://business.mapsofindia.com/insurance/iffco-tokio.htmlhttp://business.mapsofindia.com/insurance/iffco-tokio.htmlhttp://business.mapsofindia.com/insurance/icici-lombard.htmlhttp://business.mapsofindia.com/insurance/icici-lombard.htmlhttp://business.mapsofindia.com/insurance/export-credit-guarantee-corporation-of-india-ltd.htmlhttp://business.mapsofindia.com/insurance/export-credit-guarantee-corporation-of-india-ltd.htmlhttp://business.mapsofindia.com/insurance/employee-state-insurance-corporation.htmlhttp://business.mapsofindia.com/insurance/employee-state-insurance-corporation.htmlhttp://business.mapsofindia.com/insurance/cholamandalam-ms-general-insurance.htmlhttp://business.mapsofindia.com/insurance/cholamandalam-ms-general-insurance.htmlhttp://business.mapsofindia.com/insurance/bajaj-allianz-insurance-india.htmlhttp://business.mapsofindia.com/insurance/bajaj-allianz-insurance-india.htmlhttp://business.mapsofindia.com/insurance/anz-insurance.htmlhttp://business.mapsofindia.com/insurance/anz-insurance.htmlhttp://business.mapsofindia.com/insurance/amsure-insurance.htmlhttp://business.mapsofindia.com/insurance/amsure-insurance.htmlhttp://business.mapsofindia.com/insurance/agriculture-insurance-company-of-india-ltd.htmlhttp://business.mapsofindia.com/insurance/agriculture-insurance-company-of-india-ltd.htmlhttp://business.mapsofindia.com/insurance/general-insurance-india.html


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LIFE INSURERS Websites

Public Sector

Life Insurance Corporation of India www.licindia.com

Private Sector

Allianz Bajaj Life Insurance Company Limited www.allianzbajaj.co.in

Birla Sun-Life Insurance Company Limited www.birlasunlife.com

HDFC Standard Life Insurance Co. Limited www.hdfcinsurance.com

ICICI Prudential Life Insurance Co. Limited www.iciciprulife.com

ING Vysya Life Insurance Company Limited www.ingvysayalife.com

Max New York Life Insurance Co. Limited www.maxnewyorklife.com

MetLife Insurance Company Limited www.metlife.com

Om Kotak Mahindra Life Insurance Co. Ltd. www.omkotakmahnidra.com

SBI Life Insurance Company Limited www.sbilife.co.in

TATA AIG Life Insurance Company Limited www.tata-aig.com

AMP Sanmar Assurance Company Limited www.ampsanmar.com

Dabur CGU Life Insurance Co. Pvt. Limited www.avivaindia.com


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GENERAL INSURERS

Public Sector

National Insurance Company Limited www.nationalinsuranceindia.com

New India Assurance Company Limited www.niacl.com

Oriental Insurance Company Limited www.orientalinsurance.nic.in

United India Insurance Company Limited www.uiic.co.in

Private Sector

Bajaj Allianz General Insurance Co. Limited www.bajajallianz.co.in

ICICI Lombard General Insurance Co. Ltd. www.icicilombard.com

IFFCO-Tokio General Insurance Co. Ltd. www.itgi.co.in

Reliance General Insurance Co. Limited www.ril.com

Royal Sundaram Alliance Insurance Co. Ltd. www.royalsun.com

TATA AIG General Insurance Co. Limited www.tata-aig.com

Cholamandalam General Insurance Co. Ltd. www.cholainsurance.com

Export Credit Guarantee Corporation www.ecgcindia.com

HDFC Chubb General Insurance Co. Ltd.

REINSURER

General Insurance Corporation of India www.gicindia.com


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Basic functions of Insurance

1.Primary Functions

2.Secondary Functions

3.Other Functions


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Primary functions of insurance

Providing protection The elementary purpose of insurance is to allowsecurity against future risk, accidents and uncertainty. Insurance cannot arrestthe risk from taking place, but can for sure allow for the losses arising with therisk. Insurance is in reality a protective cover against economic loss, byapportioning the risk with others.

Collective risk bearing Insurance is an instrument to share the financial loss.

It is a medium through which few losses are divided among larger number ofpeople. All the insured add the premiums towards a fund and out of which thepersons facing a specific risk is paid.

Evaluating risk Insurance fixes the likely volume of risk by assessing diversefactors that give rise to risk. Risk is the basis for ascertaining the premium rateas well.

Provide Certainty Insurance is a device, which assists in changinguncertainty to certainty.


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Secondary functions of insurance

Preventing losses Insurance warns individuals andbusinessmen to embrace appropriate device to preventunfortunate aftermaths of risk by observing safetyinstructions; installation of automatic sparkler or alarmsystems, etc.

Covering larger risks with small capital Insuranceassuages the businessmen from security investments. Thisis done by paying small amount of premium against largerrisks and dubiety.

Helps in the development of larger industriesInsurance provides an opportunity to develop to those largerindustries which have more risks in their setting up.


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Other functions of insurance

Is a savings and investment tool Insurance is the best savings andinvestment option, restricting unnecessary expenses by the insured. Also totake the benefit of income tax exemptions, people take up insurance as agood investment option.

Medium of earning foreign exchange Being an international business,any country can earn foreign exchange by way of issue of marine insurance

policies and a different other ways.

Risk Free trade Insurance boosts exports insurance, making foreign traderisk free with the help of different types of policies under marine insurancecover.

Insurance provides indemnity, or reimbursement, in the event of anunanticipated loss or disaster. There are different types of insurance policiesunder the sun cover almost anything that one might think of. There are loadsof companies who are providing such customized insurance policies.


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Indian Insurance Sector

The US$ 41-billion Indian life insurance industry isconsidered the fifth largest life insurance market, andgrowing at a rapid pace of 32-34 per cent annually,according to the Life Insurance Council.

Since the opening up of the insurance sector in India, theindustry has received FDI to the tune of US$ 525.6million.

The government is likely to reintroduce the Insurance Billwhich proposes to increase the FDI cap in private sectorinsurance companies from 26 per cent to 49 per cent.


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The total number of life insurers registered with the Insurance

Regulatory Development Authority (IRDA) has gone up to 23.

The Life Insurance Corporation (LIC) posted a 50 per cent growth innew premium collection in the first nine months of the 2010 fiscal,increasing its market share to 65 per cent from 56 per cent a yearago.

LICs new premium collection touched US$ 9.58 billion in the April-December 2009 period while the combined business of the 22private insurers grew to US$ 5.07 billion from the previous year, asper data collated by the Insurance Regulatory and Development

Authority (IRDA).

Overall the industry grew at 29 per cent in the April-Decemberperiod of the fiscal year 2010.


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General Insurance

The total number of general insurers registered with IRDA has gone upto 22, with the registration of SBI General Insurance Company Limited,a joint venture general insurance company promoted by State Bank ofIndia and Insurance Australia Group, Australia, as a general insurer inDecember 2009.

Overall, the non-life insurance sector grew 9.95 per cent in April-December

2009, compared to the corresponding period last year

According to IRDA data, out of the US$ 5.46 billion premium underwrittenby the industry during the April-December 2009 period, US$ 3.24 billioncame from the four public sector companies as compared to US$ 2.91billion during the same period in 2008.

The Gross Premium underwritten by public sector non-life insurers for theApril-December 2009 period posted year-on-year growth of 11.37 per centas compared to the year-on-year growth of 7.93 per cent posted by privatesector non-life insurers


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Moreover, in the 2010-11 budget, Finance Minister, Mr PranabMukherjee, has decided to roll back the governments decision to taxthe unrealised gains of non-life insurance companies.

The appreciation in the value of investments, being in the nature ofunrealized gain is not taken into account for determining profit or

loss of non-life insurance business as per the IRDA regulations. It is,therefore, proposed that the unrealized gains due to appreciation inthe value of investments will not be included in the total income,according to the budget documents.

According to data from the IRDA (Summary Reports of Motor Data

of Public and Private Sector Insurers - 2008-09), in 2008-09, nearly30 million vehicles were registered and a total premium worth US$2.03 billion was collected.


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Project Insurance

Insurance companies are also witnessing increasing demand forproject insurance in the last few months. Corporates are beginningto demand project insurance across sectors such as powergeneration with the cover beginning right from the start of the projecttill it is declared ready for commercial use.

Some of the big projects also take cover for financial loss arising outof delay in completion.

Industry players estimate that premiums collected from projectinsurance will be around US$ 216.2 million for the industry as awhole and is expected to increase significantly.

Oriental Insurance Company Ltd will be offering comprehensiveproject insurance for the Tata Power Project at Mundra in Gujarat.


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Health Insurance The health insurance market stood at around US$ 1.5 billion in 2008-09 and is

expected to grow to US$ 9 billion by 2016-17. While health insurance policiesare mostly provided by general insurance companies, life insurers contributeabout five per cent to the overall health insurance business.

Apollo DKV Health Insurance has renamed itself Apollo Munich HealthInsurance as a part of its five-year strategic plan to gain a five per cent marketshare. Apollo Munich is a joint venture between Asias largest integrated

healthcare provider, The Apollo Hospitals Group, and Germany-based MunichRe's segment, Munich Health.

Max India is planning to invest US$ 43.25 million in its health insurance jointventure (Max Bupa) and will launch a product over the JanuaryJune 2010period.

Star Health and Allied Insurance expects to invest US$ 38.9 million during thecurrent financial year to grow its health insurance business, taking the totalinvested capital to US$ 67 million.

US-based health insurer CIGNA is looking at entering the Indian market.


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Reinsurance

Reinsurance is a contract between the insurance company (insurer) and athird party (re-insurer), wherein the latter will protect the former by payinglosses sustained by it under the original contract of insurance.

Re-insurers from London, as well as other parts of Europe, see significantpotential in the re-insurance market in India. Top four global re-insurers,Lloyds, Swiss Re, Munich Re and Berkshire Hathaway are amongst thoseeyeing India.

Bancasssurance

Private insurers have adopted bancassurance in a much bigger way thanthe state-owned Life Insurance Corporation (LIC) in the recent years.

Bancassurance is distribution of insurance products through a bank'snetwork.

In 2008-09, private insurers forked out US$ 44.4 million as commission forbanassurance, while the payout by LIC for this distribution model was US$25,948.


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Investment Policy

The FDI limit in the insurance space for foreign players is capped at 26 percentpermissible under the automatic route subject to a licence from theofficial regulator, IRDAbut the government is planning to raise it to 49 percent and a bill to give effect to the proposal is pending in the Rajya Sabha.

IRDA has stipulated that the mandatory ceding by every general insurer in the

country to the national reinsurer General Insurance Corporation (GIC),would continue to remain at 10 per cent as under current regulations.

IRDA has also allowed insurance companies to offer 'Health plus Life CombiProduct', a policy that would provide life cover along with health insurance tosubscribers.

Pension Fund Regulatory and Development Authority (PFRDA) would launcha low-cost pension scheme on April 1, 2010, to provide social security cover toeconomically weaker sections like rickshaw pullers, barbers and daily-wagelabourers


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Indian Insurance Sector The Road Ahead

Saturation of insurance markets in many developed economies has madethe Indian market more attractive for international insurance players,according to 'Booming Insurance Market in India (2008-2011). Further,according to the report,

Total life insurance premium in India is projected to grow US$ 266 billion by

2010-11

Total non-life insurance premium is expected to increase at a compoundannual growth rate (CAGR) of 25 per cent for the period spanning from2008-09 to 2010-11

The home insurance segment is set to achieve a 100 per cent growth asfinancial institutions have made home insurance obligatory for housing loanapprovals

In the next three years, health insurance is poised to become the secondlargest business for non-life insurers after motor insurance


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Insurance Regulatory and Development Authority - Irda

Insurance Regulatory and Development Authority Irda

IRDA was set up by the parliament in 1999. The section 4 of IRDA Act' 1999, Insurance Regulatory and DevelopmentAuthority specify the composition of Authority The Authority is a ten-member team consisting of a. Chairman; b.five whole-time members; c. four part-time members, All these positions are appointed by the Government of India

IRDA - Duties,Powers and Functions:Section 14 of IRDA Act, 1999 lays down the duties, powers and functions of IRDA..(1) Subject to the provisions ofthis Act and any other law for the time being in force, the Authority shall have the duty to regulate, promote andensure orderly growth of the insurance business and re-insurance business.

Head OfficeInsurance Regulatory and Development Authority3rd Floor, Parisrama Bhavan,Basheer BaghHYDERABAD 500 004Andhra Pradesh (INDIA )Ph: (040) 23381100Email:[email protected]

Delhi OfficeInsurance Regulatory and Development AuthorityDelhi Office - Gate No. 3Jeevan Tara Building, First FloorSansad Marg,New Delhi-110001Ph: (011) - 2374 7648

Chairman:

Mr.J.Hari Narayan040-23241273040-66820957Fax : [email protected]

I di I P li


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India Insurance Policy

The Insurance Policy India is regulated by certain acts like the Insurance Act(1938), the Life Insurance Corporation Act(1956), General InsuranceBusiness (Nationalization) Act(1972), Insurance Regulatory and Development Authority (IRDA) Act(1999).

The insurance policy determines the covers against risks, sometime opens investment options with insurance companies setting high returns and alsoinforms about the tax benefits like the LIC in India. There are two types of insurance covers:

1. Life insurance

2. General insurance

Life insurance this sector deals with the risks and the accidents affecting the life of the customer. Alongside, this insurance policy also offerstax planning and investment returns. There are various types of life Insurance Policy India:

a. Endowment Policy

b. Whole Life Policy

c. Term Life Policy

d. Money-back Policy

e. Joint Life Policy

f. Group Insurance Policy

g. Loan Cover Term Assurance Policy

h. Pension Plan or Annuities

i. Unit Linked Insurance Plan

General Insurance

this sector covers almost everything related to property, vehicle, cash, household goods, health and also one's liabilitytowards others. The major segments covered under general Insurance Policy India are:

a. Home Insurance

b. Health Insurance

c. Motor Insurance

d. Travel Insurance


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Policy Change in the Indian Insurance market

The Insurance Regulatory Development Act, 1999 (IRDA Act) allowed the entry ofprivate companies in the insurance sector, which was so far the sole prerogative ofthe public sector insurance companies. The act was passed to protect the concernsof holders of insurance policy and also to govern and check the growth of theinsurance sector. This new act allowed the private insurance companies to functionin India under the following circumstances :

The company should be established and registered under the 1956 company Act

The company should only the serve the purpose of life or general insurance orreinsurance business

The minimum paid up equity capital for serving the purpose of reinsurancebusiness has been decreed at Rs 200 crores

The minimum paid up equity capital for serving the purpose of reinsurancebusiness has been decreed at Rs 100 crores

The average holdings of equity shares by a foreign company or its subsidiaries ornominees should not go above 26% paid up equity capital of the Indian Insurancecompany.


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Future of Indian Insurance Market

As per the report of 'Booming Insurance Market in India' (2008-2011), concentration of insurance markets in many developedcountries of the world has made the Indian insurance market moremagnetic in terms of international insurance players. Furthermore,the report says

Home insurance sector is likely to achieve a 100% growth sincehome insurance are made compulsory for housing loan approvals bythe financial institutions.

In the coming three years Health insurance sector is all set tobecome the second largest business after motor insurance.

During the period of 2008-09 to 2010-11 the non life insurancepremium is likely to have a growth of 25%.

Insurance Job Profiles in India


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The Indian insurance industry churns out large volume of jobs every year. This industry is so vast that youwould find attractive opportunities in the fields of general insurance, health insurance, finance insurance,travel insurance, online insurance and not to forget the life insurance. However, some of the specific areas ofexpertise in this industry include:

Agent and Broker: Insurance agents/ brokers are the people who give product advice to the clients in order

to sell company's product.

Customer Service Agent: the person in-charge of this post needs to interact with the customer on dailybasis in the agency to update policy as well as coverage details.

Claims Adjuster: the office holder needs to ascertain the range of damage in case of accidents and see ifthe insurance policy can cover it. He/ she make way for settlement between the insurance company and itscustomers.

Actuary: this is one of the very crucial insurance jobs. The person in-charge of this office needs to analyzethe risks involved in creating the insurance policies in the areas of business, property or life & death of theperson. To find a job in this area, the aspirant needs to be Mathematics, Econometrics, Statistics or ComputerScience graduate. MBAs in finance can also apply for the post.

Risk Manager: the person needs to spot the risk and suggest the ways to tackle such risks. Service Representatives: this profile demands an individual to act as a medium between the insurance

companies and agents.

Loss Control Specialist: the office holder needs to look into safety measures so that accidents at theworkplace which can lead to financial losses can be avoided.

Underwriter: the office holder needs to determine the applicant's chances of risks and whether the policychosen by him/ her meets the insurance standard.


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Indian Insurance Industry - Challenges

New Comer poses threat - With more companies coming up everyday withthe growing demand of the industry the markets very competitive. Until andunless the existing companies makes a mark and create their very own

brand name it would be quite tough to sustain their position in the market.There is also a probability of big companies taking over the new emergingcompanies.

Supplier Power: The people providing the capital don't act as big terror asopportunity always lies in the big hands and they can any day tempt good

insurer from small companies to their own company.

Buyer Power: Individual never stands a chance in front of big corporatesectors as they dominate the insurance industries with high potential ofnegotiation power.

Presence of substitutes: The insurance industry is full of replacement optionand the large insurance companies offers the same service as of others beit in any sector of home, commercial, auto, health or life.

Business Plan of Insurance Sector

Documents

Transcript of Business Plan of Insurance Sector